fund

Rated

This is one of our rated funds. They’re the ones our experts believe will do well for investors over the longer term. Top of the class!

Threadneedle UK Equity Income Z GBP

  • 150.44p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • 212.90p
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 0.75%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 0.82%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 2.80%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 22 October 2021, fund data last updated 08 October 2015

The fund aims to maximise capital growth and achieve a 10% income premium to the FTSE All Share Index over a three to five year period. Manager Richard Colwell’s investment approach is a combination of bottom-up fundamentals and top-down economic analysis. He looks to invest in “hidden gem” UK equities with a focus on FTSE 100 and FTSE 250 firms. He targets overlooked companies whose ability to grow a sustainable dividend is not reflected in their valuation and which also boast solid management and strong cash flow. The fund holds between 45 and 60 stocks, with the top 10 typically accounting for 45% of total assets. The portfolio includes Covid vaccine maker AstraZeneca and rat-catching group Rentokil Initial.

Fund summary

Sector UK Equity Income
Structure OEIC
Launched
Size £4,006m
Yield 2.80%
Charging basis Capital
Dividends paid 7 Feb, 7 May, 7 Aug, 7 Nov

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Annual management charge 0.75%
Ongoing charges figure 0.82%

Allocation

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Investment process

The fund’s investment universe is over 1,200 stocks across the FTSE All-Share Index and smaller companies on AIM. The stocks are analysed against several qualitative and quantitative criteria. This includes strong company management, a robust business model for generating profit and a strong balance sheet and cash flow generation. Other factors include an attractive valuation compared to the company’s peers and history and a high and stable or growing dividend. Colwell also looks for companies with the potential to improve in any of these areas. The fund does not use any yield screens or have a yield hurdle for a stock to be considered. The team uses a portfolio manager-analyst model whereby all members have analyst coverage over at least one sector. As part of the selection process Colwell and his team carry out over 800 company meetings a year. Topics covered at these meetings typically range from a management team’s track record, to its strategy, capital allocation over time, and Environmental, Social and Governance issues.

The fund benefits from being led by manager Richard Colwell who has a strong and long track record in this sector. Colwell takes a balanced and pragmatic approach, unlike certain peer funds which can be more aggressively or defensively positioned. As such he chooses to find a balance between defensive and cyclical sectors. Diversification is also a key feature of the fund with Colwell moving away from the income-paying mega-caps dominating the benchmark. This is a core and dependable option in the IA UK Equity Income sector. Colwell has historically been able to generate a steady level of performance both in income and capital over time across most market conditions.

Manager research

Average monthly relative returns

  • 16/17 0.00%
  • 17/18 0.00%
  • 18/19 0.00%
  • 19/20 0.00%
  • 20/21 0.00%

Bestinvest MRI

  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.00%
  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.00%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Track record

Periods of worst performance

Absolute 0.00% ()
Relative 0.00% ()

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

Allocation

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Sector breakdown

Industrials 33.00%
Consumer Staples 17.00%
Consumer Discretionary 14.00%
Financials 14.00%
Health Care 13.00%
Utilities 3.00%
Basic Materials 2.00%
Telecommunications 2.00%
Cash & Cash Equivalents 1.00%
Money Market 1.00%

Portfolio

45-60 stocks with low turnover.

Key Investor Information - Income

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Key Investor Information - Accumulation

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